The Guardian reported that John Healey plans to raise the tax take from Britain's banks in the forthcoming budget, as he attempts to strengthen public finances after increased borrowing costs linked to Middle East tensions. One option under discussion involves reversing cuts to the bank surcharge made by the previous government, which could raise more than £2 billion annually. Industry figures expect this would likely mean raising the surcharge to 8 per cent, up from its current level of 3 per cent.
Despite praising banks as integral to the UK economy, Healey's move reflects the government's need to find additional sources of revenue. The chancellor told reporters that banks are "hardwired into the economic fabric of this country and our future prospects", emphasising their role in supporting economic growth.
UK Finance, the banking sector trade body, has warned against the expected increase. The organisation stated that higher bank taxes would "weaken competitiveness, discourage investment and job creation, and work against the government's ambition to deliver growth in every postcode". Senior banking executives have indicated they anticipate the sector will feature prominently in budget discussions.